Chemphil Export and Import Corporation v. Philippine Investments Systems Organization
REITERATIONFacts
The Antecedents: Dynetics, Inc. and Antonio M. Garcia filed a civil action for declaratory relief and/or injunction against a consortium of banks (CONSORTIUM). The trial court denied their prayer for a preliminary injunction but ordered the issuance of a consolidated writ of preliminary attachment against Dynetics, Inc. and Antonio M. Garcia, leading to the garnishment of various properties, including shares of stock in Chemphil owned by Antonio M. Garcia. Procedural History: The trial court dismissed the complaint and counterclaims. The CONSORTIUM appealed to the Court of Appeals (CA-G.R. CV No. 20467). Subsequently, the CONSORTIUM and Antonio M. Garcia entered into a compromise agreement, which was approved by the Court of Appeals. Antonio M. Garcia failed to comply, prompting the CONSORTIUM to move for execution. Properties of Antonio M. Garcia, including the Chemphil shares, were sold in execution. The CONSORTIUM then moved for the corporate secretary of Chemphil to register the certificate of sale and issue new shares in their name. Chemphil Export and Import Corporation (CEIC) intervened, claiming a preferred right over the shares by assignment from Ferro Chemicals, Inc., which had purchased the shares from Antonio M. Garcia. The trial court allowed CEIC to intervene and issued a cease-and-desist order, nullifying its previous order directing the registration of the sale. The CONSORTIUM appealed this decision to the Court of Appeals (CA-G.R. CV No. 26511). The Petition: The CONSORTIUM filed a motion to consolidate CA-G.R. CV No. 26511 with CA-G.R. CV No. 20467. CEIC opposed this motion, arguing there was no common question of law or fact or parties. The Court of Appeals granted the consolidation. CEIC filed a motion for reconsideration, which was denied. Hence, CEIC filed the present petition for certiorari.
Issue(s)
Whether the respondent Court of Appeals gravely abused its discretion when it ordered the consolidation of CA-G.R. CV No. 26511 with CA-G.R. CV No. 20467.
Ruling
The petition is dismissed for lack of merit. The Court of Appeals did not commit grave abuse of discretion in ordering the consolidation.
Ratio Decidendi
On the issue of consolidation: The Court held that the respondent Court of Appeals did not gravely abuse its discretion in ordering the consolidation of CA-G.R. CV No. 26511 with CA-G.R. CV No. 20467. It was undisputed that both cases originated from the same Civil Case No. 8527. CA-G.R. CV No. 20467 involved the appeal by the CONSORTIUM banks questioning the trial court's order dismissing their counterclaims, which CEIC argued led to the automatic dissolution of the attachment on the disputed Chemphil shares. Conversely, CA-G.R. CV No. 26511 directly revolved around the ownership of these same disputed Chemphil shares, with both CEIC and the CONSORTIUM banks contesting ownership. The shares were initially attached by the CONSORTIUM, subsequently sold on execution to satisfy a judgment based on a compromise agreement against Antonio M. Garcia, and then claimed by CEIC during the execution proceedings. Therefore, the two cases were intimately and substantially related, making their consolidation inevitable to prevent conflicting decisions, as supported by the ruling in Benguet Corporation, Inc. v. Court of Appeals. The fact that CEIC was not an original party in CA-G.R. CV No. 20467 did not preclude consolidation, as the Revised Internal Rules of the Court of Appeals allow consolidation when cases involve related questions of fact and/or law, even if parties are not identical. The Court emphasized that as long as two or more cases involve related questions of fact and/or law, their consolidation is in order. Consequently, the consolidation ordered by the Court of Appeals was justified and did not constitute grave abuse of discretion.
Main Doctrine
The Court of Appeals did not commit grave abuse of discretion in ordering the consolidation of two cases that originated from the same civil action and involved substantially related questions of fact and law, even if one of the intervenors was not an original party to one of the consolidated cases.